BP’ s profits fuel calls for windfall tax

BP has notched up its highest quarterly underlying profits for more than a decade thanks to rocketing oil and gas prices as calls mount for a windfall tax on the sector.

The oil giant saw underlying replacement cost profits – its preferred measure – more than double to 6.2 billion US dollars (£5bn) for the first three months of the year from 2.6bn US dollars (£2.1bn) a year ago.

But on a statutory basis, BP swung to a 23bn US dollar (£18.4bn) loss after taking a mammoth 25.5bn US dollar (£20.4bn) hit from its move to ditch its near-20% stake in Russian oil producer Rosneft in response to the Ukraine war.

The underlying result was far better than the 4.5bn US dollars (£3.6bn) expected by analysts and is likely to further fuel demands from Labour and the Liberal Democrats for a windfall tax on oil and gas firms to help ease the cost of living crisis.

Chancellor Rishi Sunak has so far distanced himself from slapping a tax on the industry, instead looking to companies making big profits to invest the cash back into the UK.

In response, BP unveiled plans alongside its quarterly figures to invest up to £18bn into the UK energy system by 2030.

It pledged to invest in North Sea oil and gas, while driving down operational emissions, and said it is

also working on a range of lower carbon energy projects in the UK, which are set to create jobs.

In a further sign that it is seeking to head off criticism, BP also stressed it expects to pay up to £1bn in taxes for its 2022 North Sea profits, on top of around £250 million paid annually in other UK taxes.

Chief executive Bernard

Looney insisted the group is “backing Britain”.

He said: “It’s been our home for over 110 years, and we’ve been investing in North Sea oil and gas for more than 50 years.

“We’re fully committed to the UK’S energy transition – providing reliable homegrown energy and, at the same time, focusing on the drive to net-zero.”

Business Secretary Kwasi Kwarteng last week wrote to the oil and gas industry saying it must also set out plans for investment in clean energy during a meeting in the coming weeks.

But Labour and the Lib Dems want the government to go further and are backing calls for a windfall tax on the companies.

INVESTMENT: BP chief executive Bernard Looney said the firm is committed to the UK.